Britain invokes security law to review Drahi's BT stake deal

Shares in BT were down 5.3% in early trade on the London Stock Exchange.

BT maintains the telephone cables and exchanges connecting nearly all UK homes and businesses to the broadband and telephone network. PA Media
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Britain's business minister has launched a national security review of a deal by the telecoms group's biggest shareholder, French billionaire Patrick Drahi, to increase his stake in BT to about a fifth of equity.

BT said it would fully co-operate with the government review, permissible under Britain's national security and investment laws.

Mr Drahi bought 12.1 per cent of BT last June and increased that holding to 18 per cent in December.

“[The UK] will not hesitate to act if required to protect our critical national telecoms infrastructure,” a government representative had said at the time.

Shares in BT were down 5.3 per cent in early trade on the London Stock Exchange.

Business Secretary Kwasi Kwarteng has told BT that the government will examine Mr Drahi’s stake in the company over national security concerns.

Altice, Mr Drahi’s investment arm and the company's biggest shareholder, increased its stake last year, increasing fears that the business could be ripe for a takeover.

The government will now seek to examine the move using “call-in powers” under the new National Security and Investment Act.

Mr Kwarteng will have the power to either clear the move or, “if necessary and proportionate”, impose certain conditions on the investment or block it completely.

The act also specifically allows the government to halt a single investor from owning more than 25 per cent in a business deemed to be of national significance.

BT maintains the telephone cables and exchanges connecting nearly all UK homes and businesses to the broadband and telephone network through its Openreach operation.

“BT Group will fully co-operate with this review,” the company said.

Updated: May 26, 2022, 8:38 AM